EDITOR'S CHOICE -- SCOTT SUTTELL

Former friend slaps Pilot Flying J with another lawsuit

The truck stop chain owned by the family of Cleveland Browns owner Jimmy Haslam has been under investigation for skimming rebates to customers, and The Wall Street Journal reports it has “hit a new stumbling block: a lawsuit that could exceed $70 million by one of its most loyal trucking customers, which will be represented by a plaintiff's law firm that was a leader in the successful fight against the tobacco industry.”

Western Express Inc. filed the lawsuit in late August. (Via Cleveland.com, you can find some background here and here on how Western Express caught onto the rebate situation at Pilot Flying J.)

The Western suit “accuses Pilot of breach of contract, alleging that Pilot charged Western more per gallon of diesel fuel than its agreements with Western called for,” The Journal reports. Over the past decade, Western bought 90% of its fuel from Pilot, which amounted to more than $1 billion, according to the suit.

The suit contends that the alleged fraud created a shortfall for Western Express "that crippled it financially over the next few years," says John W. Houghtaling II, managing partner at Gauthier, Houghtaling & Williams, a New Orleans firm that helped organize the legal fight against tobacco companies in the 1990s.

Aubrey Harwell Jr., an attorney for Pilot Flying J, tells The Journal that the allegations in the Western lawsuit as "extremely aggressive and overreaching." He characterized the business between Pilot and Western as "a very complicated series of transactions. It was made more complicated by a very close relationship between senior officials" of both companies, he said.

The dispute apparently cuts close to home for both companies.

“Western Express, based in Nashville, and Pilot, in Knoxville, had such a close relationship, according to people familiar with both companies, that after Western co-founder Wayne Wise died in 2010, Pilot President Mark Hazelwood walked Mr. Wise's daughter down the aisle at her wedding,” The Journal reports.

The road to nowhere

Reuters reports that Cleveland-based mining company Cliffs Natural Resources Inc. “has lost a key land dispute at a Canadian tribunal that could cause more problems for its already troubled Black Thor chromite project in northern Ontario's mineral-rich Ring of Fire.”

Cliffs “cannot build a proposed highway to the wilderness region without the consent of tiny rival KWG Resources Inc., which has staked claims along the route and wants to build a railway instead,” Reuters reports, citing an Ontario Mining and Lands Commissioner decision dated Sept. 10 and posted online by KWG.

A Cliffs spokeswoman, Patricia Persico, tells Reuters that the company is considering its options, including appealing the decision. It was not immediately clear what body would hear an appeal.

"It does put the project in jeopardy," Ms. Persico tells Reuters. She says the highway is a "necessary" part of Black Thor.

Reuters reports that Cliffs in June suspended its work on the $3.3 billion Black Thor project, citing stalled talks with the provincial government and other political and regulatory problems. It “has struggled to win over aboriginal communities in the region,” according to the news service.

And the winner is ...

The verdict hands Ford a big victory in a case that previously resulted in a $2 billion judgment against the automaker.

The plaintiffs “claimed Ford offered secret discounts to some dealers even though it was obligated by sales and service agreements to publish all prices,” Bloomberg notes. The suing dealers said those excluded from discounts wound up paying more for vehicles, hurting their profits, according to the news service.

But Ford “denied committing any breaches or overcharging dealers, contending a program that offered some discounts wasn't barred by the contract,” Bloomberg reports. And the jury agreed.

“The men and women who worked for Ford and who have been involved in this program for three decades have been vindicated,” James Feeney, the company's trial lawyer, told Bloomberg in an interview after the verdict. “Our view all along is that there was no breach of this contract.”

But this might not be the end of the matter, as the dealers are considering an appeal.

James Lowe, their lawyer, characterized the jury's decision as “surprising.”

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